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Supreme Court Determines Fee Enhancements Are Allowed For Superior Performance

On April 21st, the U.S. Supreme Court unanimously reaffirmed the 11th Circuit Court of Appeals’ decision that reasonable attorney fee awards may include enhancements for superior performance under a federal fee-shifting statute in civil rights cases. (Perdue v. Kenny A., U.S. No. http://08-970, 4/21/10). However, the enhancement may only be allowed in “extraordinary circumstances.”

The issue of when an enhancement may be allowed was raised in a civil rights class action brought on behalf of foster children throughout Fulton County and DeKalb County, Georgia by private attorneys and non-profit children’s rights advocacy groups alleging that the State’s foster case system violated 42 U.S.C. Sec. 1983, as well as other state and federal laws. After 3 years of extensive motion and discovery work, both sides resolved the issue through mediation, entering into a consent decree aimed at implementing sweeping reforms.

As part of the decree, plaintiffs’ attorneys were entitled to fees pursuant to 42 U.S.C. Sec. 1988. Fees allowed under Sec. 1988 are subject to the same standards as those allowed pursuant to federal employment discrimination and wage/hour statutes.

The fees were determined by a lodestar figure (reasonable hourly rate multiplied by hours worked). The lodestar figure was then enhanced by a factor of 1.75 based on the plaintiffs’ attorney’s quality of work – which the district court noted, “far exceeded what the foster children could have received in the private market” and the exceptional results achieved.

The U.S. Court of Appeals for the 11th Circuit affirmed the district court’s enhancement. Kenny A. v. Perdue, 532 F.3d 1209, 1214 (11 Cir. 2006).

Writing for the majority, Justice Alito (Perdue v. Kenny A., U.S. No. http://08-970, 4/21/10) reaffirmed that the quality of an attorney’s performance and results obtained may provide the basis for an enhancement. He further noted that the “strong presumption” that the lodestar is reasonable may be overcome in those rare circumstances in which the lodestar does not adequately account for a factor that may properly be considered in determining a reasonable fee.”

The Supreme Court set forth three factors (Perdue v. Kenny A., U.S. No. http://08-970, 4/21/10) for determining when an enhancement may be awarded.

These include:
• The lodestar calculation fails to adequately measure the attorney’s true market value
• The attorney’s performance includes an extraordinary outlay of expense and the litigation is exceptionally protracted
• Extraordinary circumstances in which an attorney’s performance involves an exceptional delay in the payment of fees

Although the Supreme Court found that enhancements may be allowed in exceptional cases, it reversed the enhancement award in this case, finding that specific evidence did not exist supporting the increased fee in this matter.

For more information or if you have questions regarding civil rights or discrimination, please contact Buckley Bala Wilson Mew LLP, LLC, a Georgia employment law firm dedicated to protecting individual’s rights.

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